Source: Cointelegraph
Original: “Bitcoin (BTC) Pulls Back After Breaking $95,000, Institutional Activity May Trigger Market Volatility”
Last week, the price of Bitcoin (BTC) broke through $95,000, reaching a seven-week high. However, it suddenly declined over the weekend. As of Monday (April 28), Bitcoin had not regained the upward momentum from the previous week. By 1 PM on Monday, Bitcoin's 24-hour decline was 0.26%, priced at $94,014.
Matt Mena, a research strategist at a Swiss crypto investment firm, previously pointed out that after Bitcoin breaks through the resistance level of $95,000, there would be a brief consolidation. Following that, $100,000 will become a key psychological price point.
He stated, “As macro and global situations increasingly highlight the demand for digitalization and next-generation value storage methods, Bitcoin is increasingly playing this role. What distinguishes this rise is the significant increase in investor confidence in Bitcoin as a macro hedge tool. More and more investors no longer see it merely as a speculative asset but view it as a safe-haven asset against rising uncertainty in traditional markets.”
Last Tuesday, there was a surge in inflows into exchange-traded funds (ETFs) tracking Bitcoin prices, as investors' interest in Bitcoin's potential as a hedge tool grew amid ongoing stock market turbulence and a declining dollar. According to SoSoValue, Bitcoin ETFs recorded an inflow of $936.43 million that day, the largest single-day inflow since January 17.
In the spot market, the actual amount of funds or trading volume purchasing Bitcoin each month is decreasing. However, Julio Moreno, head of research at on-chain data analysis platform CryptoQuant, pointed out that this contraction trend has recently slowed, alleviating downward pressure on Bitcoin prices. However, he also warned that demand growth indicators are still some distance from the levels needed by the end of 2024, and Bitcoin will need stronger demand support to maintain its upward momentum and reach new highs.
Joel Kruger, a market strategist at global multi-asset exchange and fintech company LMAX, stated, “This recent rise mainly reflects the market seizing opportunities to profit from asset declines. This asset continues to prove its value as an attractive choice for portfolio diversification, hedging against macroeconomic uncertainty, and dollar volatility.”
A significant outflow of cryptocurrencies from exchanges, especially to non-custodial wallets, often indicates a shift in investor sentiment and strategy. According to CryptoQuant, last Friday, 27,750 Bitcoin flowed out of Binance, marking the third-largest outflow in Binance's history.
Crypto analyst Joao Wedson noted that while the recent outflows do not necessarily indicate a surge in Bitcoin prices, they do suggest strong institutional activity, which is often a precursor to significant market volatility.
Related: Bitcoin (BTC) price may hit an all-time high in May—here's why.
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